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2015 (6) TMI 287 - AT - Income TaxAddition on account of Mobilization advance - CIT(A) deleted the addition - Held that:- As relying on assessee's own case [2011 (11) TMI 506 - Gujarat High Court ]the advance received by the assessee against the purchase of material at site before the execution of work, the same cannot be treated as income of the assessee, especially when the assessee is following the practice of showing advance receipts from the parties in the balance-sheet and when the work is executed, it is shown as receipt and offered for tax. - Decided in favour of assessee. Addition on account of Director’s remuneration - CIT(A) deleted the addition - Held that:- It is not controverted by the Revenue that in the immediately preceding years, i.e. AYs 2004-05 & 2006-07 the claim of the assessee in respect of the remuneration of Directors’ claim was allowed in the scrutiny assessment passed u/s.143(3) of the Act. Since the Revenue has not placed any material on record suggesting that any change into the facts and circumstances in the year under appeal, therefore we do not see no reason to interfere in the order of the ld.CIT(A).- Decided in favour of assessee. Addition on account of cessation of liability - CIT(A) deleted the addition - Held that:- Ss relying on CIT vs. Nitin S.Garg [2012 (5) TMI 30 - Gujarat High Court] wherein held that ITAT is justified in taking the view that as assessee had continued to show the admitted amounts as liabilities in its balance sheet the same cannot be treated as assessment of liabilities - merely because the liabilities are outstanding for last many years, it cannot be inferred that the said liabilities have seized to exist – it is on part of AO to prove that the assessee has obtained the benefits in respect of such trading liabilities by way of remission or cessation which he fails to do - in the absence of the creditor, it is not possible for the authority to come to a conclusion that the debt is barred and has become unenforceable - Decided in favour of assessee. Disallowance of labour charges - Held that:- is evident from the order of ld.CIT(A) that he declined to accept the evidences on the basis that no formal request has been made. The contention of the assessee had been throughout both before the AO and the ld.CIT(A) that the assessee made payment to labour contractors, such payment was made for the purpose of business. We are unable to uphold the view of ld.CIT(A) since there is no dispute with regard to the fact that the assessee has carried out certain work. In this process, he employed labour contractors. No further inquiry is made by the authorities below for finding out the genuineness of claim of the assessee. In our considered view, the assessee ought to have given chance to prove the genuineness of expenditure since it is not the case where the assessee has not carried out work at all. Therefore, to find out the quantum and nature of work executed and for carrying out such work, if any, the expenditure incurred on such work, inquiry is to be made by the Revenue. AO is hereby directed to make further inquiries in respect of claim of the assessee from the persons to whom the assessee made payments towards labour expenses - Decided in favour of assessee for statistical purposes.
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